The right to redeem a mortgage on repayment of a loan is a Constitutional right of a borrower and it is also a human right, which should not be fettered by unfair conditions, the Supreme Court stated last week in its judgment, Mathew Verghese vs M Amritha Kumar. The court was disposing of a complex case involving the Securitisation Act, the Debt Recovery Act, the Transfer of Property Act and other laws. It said that if there are differences in the amounts tendered and demanded by the lender, it could be decided later. The mortgaged property should be returned first and the disputes could be settled later. The court asserted: "We wish to state that the endeavour of the secured creditor while resorting to any sale for realisation of dues of a mortgaged asset should be that the mortgagor is entitled to some lenience to ensure that her constitutional right to property is preserved rather than being deprived of." Though the loan should be recovered expeditiously, financial institutions and lenders should not behave unreasonably or in an arbitrary manner in flagrant violation of ordinary laws, the court warned.
Govt can't change incentive scheme
If a government gives an assurance to industries that they would be given uninterrupted supply of electricity, it cannot change the terms of the incentive scheme when it is unable to fulfil the commitment. In this case, SVA Steel Re-rolling Mills vs State of Kerala, the state government promised continuous power supply for five years to new units. When there was a power shortage, the government modified the terms of the scheme and stated that when there was reduction of supply to the extent of 50 per cent or more, such period would be added to the period of five years. The industries challenged the change of policy in the high court and lost. On appeal, the Supreme Court ruled that the benefit period should be extended even for days when the supply was above 50 per cent but not 100 per cent promised. Many units cannot function without full uninterrupted power supply and they would also incur several incidental costs. It would be "unfair and immoral" for the state not to act according to its promise.
The Supreme Court has set aside the judgment of the Jharkhand High Court which had stated that Steel India Ltd was not eligible for sales tax exemption granted to certain industries under an incentive scheme. The state revenue authorities had denied the benefit to the firm which purchased raw materials such as steel scraps and produced agriculture and household articles out of them. They maintained that no new commodity comes into existence and there was no 'manufacture'. The tax exemption was available only if a new product came into existence. That view was accepted by the high court. However, the firm appealed to the Supreme Court. It said that the expression 'manufacture' in the state law covered production, making, extracting, altering, ornamenting, finishing or otherwise processing of the raw material. In this case, the steel scraps were turned into agricultural equipment and household articles. Therefore, the authorities were directed to issue exemption certificates.
Transformer integral to factory
A transformer in an industrial unit is an essential item in manufacture and, therefore it can claim concessional rate of sales tax under the UP Trade Tax Act, the Supreme Court ruled while dismissing the appeal of the Commissioner of Sales Tax against M/s Akzo Nobel India Ltd. The company manufactured and sold urea fertiliser and claimed concessional rate as the transformer was included in "accessories and components" required for manufacture of notified goods. The revenue authorities denied the benefit and issued showcause notice to the firm, contending that purchaser of transformer was not eligible for the concession. The Allahabad High Court did not accept it and granted the benefit to the manufacturer. On appeal, the Supreme Court upheld the high court view stating that transformer was an "adjunct to the efficient use of the manufacturing unit."
Govt can't change incentive scheme
If a government gives an assurance to industries that they would be given uninterrupted supply of electricity, it cannot change the terms of the incentive scheme when it is unable to fulfil the commitment. In this case, SVA Steel Re-rolling Mills vs State of Kerala, the state government promised continuous power supply for five years to new units. When there was a power shortage, the government modified the terms of the scheme and stated that when there was reduction of supply to the extent of 50 per cent or more, such period would be added to the period of five years. The industries challenged the change of policy in the high court and lost. On appeal, the Supreme Court ruled that the benefit period should be extended even for days when the supply was above 50 per cent but not 100 per cent promised. Many units cannot function without full uninterrupted power supply and they would also incur several incidental costs. It would be "unfair and immoral" for the state not to act according to its promise.
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Sales tax benefit on raw materials
The Supreme Court has set aside the judgment of the Jharkhand High Court which had stated that Steel India Ltd was not eligible for sales tax exemption granted to certain industries under an incentive scheme. The state revenue authorities had denied the benefit to the firm which purchased raw materials such as steel scraps and produced agriculture and household articles out of them. They maintained that no new commodity comes into existence and there was no 'manufacture'. The tax exemption was available only if a new product came into existence. That view was accepted by the high court. However, the firm appealed to the Supreme Court. It said that the expression 'manufacture' in the state law covered production, making, extracting, altering, ornamenting, finishing or otherwise processing of the raw material. In this case, the steel scraps were turned into agricultural equipment and household articles. Therefore, the authorities were directed to issue exemption certificates.
Transformer integral to factory
A transformer in an industrial unit is an essential item in manufacture and, therefore it can claim concessional rate of sales tax under the UP Trade Tax Act, the Supreme Court ruled while dismissing the appeal of the Commissioner of Sales Tax against M/s Akzo Nobel India Ltd. The company manufactured and sold urea fertiliser and claimed concessional rate as the transformer was included in "accessories and components" required for manufacture of notified goods. The revenue authorities denied the benefit and issued showcause notice to the firm, contending that purchaser of transformer was not eligible for the concession. The Allahabad High Court did not accept it and granted the benefit to the manufacturer. On appeal, the Supreme Court upheld the high court view stating that transformer was an "adjunct to the efficient use of the manufacturing unit."